SSA chief admits error on taxes Social Security was not withheld

September 15, 1993|By Nelson Schwartz | Nelson Schwartz,Contributing Writer

WASHINGTON -- Acting Social Security Administration Commissioner Lawrence H. Thompson said yesterday he paid just over $100 in back taxes and penalties earlier this year because his wife failed to withheld Social Security taxes for a maid.

"It was a woman my wife hired, and I never met her," said Mr. Thompson, explaining that he discovered only late last year that Social Security taxes for the woman had not been paid. The maid worked in the Thompsons' Alexandria, Va., home one day a month.

"I didn't know my wife didn't have the situation straightened out."

The admission by Mr. Thompson followed testimony by Health and Human Services Secretary Donna E. Shalala before the Senate Finance Committee earlier yesterday that tough decisions are necessary "to restore the public's waning confidence in Social Security."

Last month, the Clinton administration confirmed that both Mr. Thompson and the likely candidate to head the Social Security Administration, Texas college president Shirley Sears Chater, had failed to pay Social Security taxes on domestic employees.

Mrs. Chater also paid what she believed was owed earlier this year for several baby-sitters in the early 1970s, but a spokesman for the Department of Health and Human Services refused to disclose the sum of her payment.

But Ms. Shalala insisted after the hearing that the Mrs. Chater's problems should not have any affect on her nomination.

Mr. Thompson said he could not recall the exact timing of the maid's employment, but added that it was within the last three years. Mr. Thompson said he was "embarrassed" but described it as "an honest mistake."

"I told my wife that even if the maid were here only one day a month, we had to pay the taxes and establish that she was legally entitled to work," said Mr. Thompson, who was described at yesterday's hearing as one of the nation's leading experts on Social Security.

The maid is not an illegal alien, he said, adding that he submitted what he owed in January.

Mrs. Chater's nomination has not been formally submitted to the Senate for confirmation, although she isn't expected to face serious opposition.

If Mrs. Chater is confirmed, Mr. Thompson would become principal deputy commissioner of SSA.

Senate Finance Chairman Daniel Patrick Moynihan, a New York Democrat whose panel will review the nomination, refused to comment on Mrs. Chater's possible appointment but said after yesterday's session that the issue of nonpayment "will have to be brought up" at any future confirmation hearings. As a civil service appointee, Mr. Thompson is not subject to Senate approval.

Failure to pay Social Security taxes first became a public issue in January when a surge of public outrage forced Zoe Baird to withdraw her nomination as attorney general because she had hired two illegal aliens and never paid taxes for them.

Yesterday's hearing was held to consider a proposal by Mr. Moynihan that would make the Woodlawn-based agency an independent entity, removing it from the aegis of the Department of Health and Human Services and giving it more clout within the executive branch.

Although the plan is opposed by Ms. Shalala, it has the support of senior citizens' advocates and many legislators. Mr. Moynihan has pushed this idea for nearly a decade, but some observers say the plan could pass Congress this year.

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